Uncontrollable external business environment can be confined to two types, the economic environment and the non-economic environment. These two types of business environments create a deep impact as to how a business is run. It is important that an organization understand and thus maneuver itself to manage these two types of business environments. The economic environment consists of the economic circumstances, policies and system of the nation. The non-economic environment on the other hand consists of, social, legal, technological, cultural, natural and demographic environment. Each and every one of these aspects has a huge bearing on the operations of the firm. (Elearn Limited, 2005,Worthington, and Britton, 2009,Kew,and Stredwick, 2005).
For the purpose of this study, we will look at the business environment of Royal Dutch Shell, known simply as Shell. Shell is a global oil and gas company with its headquarters inThe Hague,Netherlands. Although its operations run in about 140 countries, employing more than 900,000 people all over. Shell is recognized as the fourth largest company in the world. The company has penetrated the African, Asian and North American markets. (Shell Homepage)
3.0 Economic Environment:
Some managers deem making money to be the most important factor within a business. But others are aware of a broader social function. Organizations are not simply formed for the purpose of churning profitability. Rather, a business should focus on various variables surrounding it such as the social elements. A business can be run best if it considers social responsibility to be one of the key elements in running a successful organization. The best balance is yet to be determined by business leaders between self interest and the welfare of the society. Organizations constantly face the call for a trade-off what they would like to do and what must be done. However, businesses can run a successful trade when they try to understand the business environment, and show compassion towards social welfare. The primary ideology behind running a successful business is also long term sustainability which can be obtained through social welfare.
Operating in a healthy environment and economy is in the interest of every business and is beneficial in the long run as well. This helps on a global basis as it provides the best prospects in developing and expanding markets.